The Pardu

The Pardu
Watchful eyes and ears feed the brain, thus nourishing the brain cells.

Friday, May 17, 2013

House Votes to Repeal Obamacare. Why? The Answer Looks Bad.



John Boehner says, “We. Will. Repeal.”
The White House says, “It’s. The. Law”


Do you want perspective on why the GOP has spent 15% of its time on insane repeal Obamacare votes?  Could the governing fallacy have to do with steady stream of contribution to Hose Representatives? If you chose to not view the charts below  at least view the Open Secrets links.  The ;picture is stark and will slap you in the face.

First, let's visit a quote from a very intelligent person.

Insanity: doing the same thing over and over again and expecting different results.
Blog Market Watch Dot Com published an interesting piece on the GOP and their insanity regarding the useless Affordable Care Act repeal votes. The John Boehner and White House tweets above are extracted from the piece. 

If you read the TPI piece "The Gallery of Shame" you read about the gun lobbying expenditures and contributions to GOP members of Congress.  The contributions shed light on why each member of the US Senate blocked background check legislation. A few Democrats also voted to block background checks and that link shows they probably voted out of fear as the money did not trickle over to their "open accounts". 

Market Watch used an interesting interactive paragraph to show how the ACA has cut into the earnings (share prices) of top Health care Insurance companies. 

Excerpt

Since there is virtually no chance the Democratic-controlled Senate will pass the legislation — and an even more remote possibility Obama would sign it — the move is more a political ploy.

Excerpt

Since the law was enacted in March 2010, share prices of four of the five major U.S. insurers — Aetna Inc. AET -0.50% , Cigna Corp. CI -1.09% , Humana Inc. HUM -0.19% , and UnitedHealth Group Inc. UNH +0.86% — have nearly doubled in value. The fifth, WellPoint Inc. WLP -1.27% , has gained about 20%. The company has struggled with declining membership enrollment and higher medical costs. Read more on Health Exchange blog.

As is frequently the case, regarding the specific corporations listed, we took the Market Watch paragraph above and sought more insight into money trails and corporate performance under the Affordable Care Act. (ACA) We sought narrative information from Reuters, charts from Yahoo Finance, and political contribution information from Open Secrets.  The Think Progress table below concisely summarizes information  about the Market Watch companies. All sources are link on a per corporation basis.

Despite Market Watch's clear indication that four of the five corporations have suffered "Share Prices" erosion, data from other sources (As delineated above) show stellar revenue performance with an exception for WellPoint. In fact, it may be purely coincidental, but charted indicators below show post Obama Stimulus performance at the level of phenomenal. The Stimulus is not a primary consideration and focus of this piece; the charted data drew attention comparable to an unattended "Benjamin" ($100.00 bill) lying in front of me. 




Aetna Inc.
Open Secrets Dot Org: Link
 PROFITS, REVENUES RISE (Q3 2012)


Aetna said its third-quarter profit had risen to $499.2 million, or $1.47 per share, from $490.4 million, or $1.30 per share, a year earlier.


Excluding tax benefits and other special items, earnings rose to $1.55 per share from $1.40. That was ahead of analysts' average estimate of $1.34, according to Thomson Reuters I/B/E/S.


Last week, larger competitor UnitedHealth Group Inc (UNH.N) also reported earnings above Wall Street expectations.


Aetna's revenue increased to $8.9 billion from $8.4 billion, in line with expectations. The company attributed the rise to higher insurance premiums in its commercial, Medicare and Medicaid businesses.


Aetna added 149,000 new medical members in the quarter to reach its full-year goal of 18.2 million.
 Chart forAetna Inc. (AET)
 Cigna Corp.
Open Secrets Dot Org: Link 
NET INCOME FALLS May 2013

Cigna's first-quarter net income fell to $57 million, or 20 cents per share, from $371 million, or $1.28 per share, a year earlier.
The results included a previously announced $507 million charge for a February deal with Berkshire Hathaway Inc (BRKa.N), which will reinsure two of Cigna's closed annuity reinsurance businesses and remove risk from the company's balance sheet.
Excluding that charge and other items, earnings were $497 million, or $1.72 per share, up from $359 million, or $1.24 per share, a year earlier.
On that basis, analysts were expecting $1.43 per share, according to Thomson Reuters I/B/E/S.
"The beat was driven by stronger-than-expected medical cost management," Oppenheimer & Co analyst Michael Wiederhorn wrote in a research note.
Chart forCigna Corp. (CI)
Humana Inc. 
Open Secrets Dot Org: Link
PROFIT DOUBLES
Humana's first-quarter net income nearly doubled to $473 million, or $2.95 per share, from $248 million, or $1.49 per share, a year earlier.The company said results were 26 cents a share higher than expected because of favorable claims settlements and the delayed cuts to Medicare reimbursement. Excluding those benefits, earnings of $2.69 a share were far higher than the $1.81 that analysts polled by Thomson Reuters I/B/E/S were expecting on that basis.

 Chart forHumana Inc. (HUM)
UnitedHealth Group Inc.
Open Secrets Dot Org: Link 
 ADVERSE INCENTIVE
The company said first-quarter net profit was $1.2 billion, or $1.16 per share, down from $1.4 billion, or $1.31 per share a year earlier.
Analysts on average had been expecting earnings of $1.14 per share, according to Thomson Reuters I/B/E/S.


Investors may have been surprised that the company did not beat earnings by more given that some hospital groups have reported low use of services this quarter, which typically benefits insurers, said Chris Rigg, an analyst at Susquehanna Financial Group. Hospital groups HCA Holdings Inc (HCA.N) and Health Management Associates Inc (HMA.N) both warned that admissions were weak in the first quarter.


"The data points we've gotten from the providers would have suggested a larger beat in the quarter," Rigg said.


The company also lowered its 2013 revenue expectation by $2.5 billion to $122 billion because a major public-sector customer had switched out of a full-risk plan to a self-funded insurance plan. In the latter, the customer pays for its employee healthcare and UnitedHealth administers the plan. UnitedHealth, which provides these services to many large companies, receives lower revenue in that fee-based business.


The switch comes as employers and insurance providers brace for the next wave of implementation of the Affordable Care Act.


"There is an adverse incentive in the Affordable Care Act to move from full-risk insurance to a service, self-insurance type model," Jefferies & Co analyst David Windley said. Moving to a self-funded plan can enable employers to avoid the new insurance premium tax next year, he said.
Chart forUnitedHealth Group Incorporated (UNH)
WellPoint Inc.
 Open Secrets Dot Org: Link
WellPoint reported a profit of $885.2 million, or $2.89 per share, up from $856.5 million, or $2.53 per share, a year earlier. It now expects 2013 net income earnings of at least $7.75 per share.
Chart forWellPoint Inc. (WLP)



Think Progress
“Combined profits for UnitedHealth Group Inc., WellPoint Inc., Aetna Inc., Cigna Corp. and Humana Inc., which cover one-third of the U.S. population, surged 13.5% to $3.4 billion in the second quarter,” they found. “If the trend holds, the five companies will take a record $14 billion in profits in 2011.”

If the healthcare industry continues to experience higher profits and increasing numbers of people  signing-up for coverage, I cannot get my brain around GOP efforts to repeal the ACA.  They factually accept money from big healthcare. In fact,  Rep. Chris Van Hollen (D-MD) has stated the repeal votes are akin to a terrible "Catch-22" for the GOP.  The GOP (Ryan Budget) includes cost analysis and projections based on existing law. The ACA is existing law!  Does the (fallacy laden) Ryan Budget fall part if the ACA is repealed?  Does the GOP care about the impact on their Budget plan if the ACA is non-existent?  I posit the GOP does not care about impact on their budget because their budget is basically "Smoke and Mirrors' (cracked mirrors) in its entirety.
“House Republicans’ budget hypocrisy knows no bounds,” Rep. Chris Van Hollen (D-MD), the Democrats’ leader on budget issues, told TPM. “This Obamacare repeal vote … exposes the mother of all budget gimmicks — the fact that the Republican claim of balancing the budget depends on the savings and revenues from Obamacare. The minute they vote to repeal the law, their budget is out of balance — they can’t have it both ways.”

Martin Bashir and Chrsi Van Hollen

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John Boehner says, “We. Will. Repeal.” I am possibly being a bit feeble minded, but I see nothing in repeal efforts, but unadulterated politics.  The GOP in the House is clearly working to strip the nation of President Obama's key piece of legislation since taking office in 2009. The following link navigates to a Healthcare Dot Gov webpage.  Specifically, you will be navigated to an ACA Timeline.  As I click though the Timeline, even with my liberal bias, I cannot find any reason conservatives would red the items and take exception. Over the last week a few articles have induced cause to pause as I listen to the GOP.  First, healthcare cost increases have slowed moderately. The less rapid increase in cost may not be due to the ACA, but there is little that indicates the ACA may not have some influence. I am not making declarative statements that the ACA has definite impact on the slowed cost increases. Another article related to well documented reductions in the US deficit. The reports are accompanied by bewilderment from many economist who to the person caution about the future. Well, I find that intriguing.  I am not hearing as much caution from economist who have supported the Administration economic strategies and plans since early 2009. In fact, Paul Krugman was very vocal in early 2009 that the Stimulus was not enough   All the while many of those, now amazed, economist continue their 'all is a world of whoa" in the nations. Yet,  another reason to find fault in administration from the Right.   It appears to date all of the obstruction  and all the resistance has simply slowed progressive towards a better society. How can I, if I was inclined, even think to buy into thought the GOP is on the right (excuse the pun) of the "repeal the ACA" activities, waste and shame?

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